Development accounting with intermediate goods

Jan Grobovšek
2017 The B.E. Journal of Macroeconomics  
I use a simple development accounting framework that distinguishes between goods and service industries on the one hand, and final and intermediate output on the other hand, to document the following facts. First, poorer countries are particularly inefficient in the production of intermediate relative to final output. Second, they are not necessarily inefficient in goods relative to service industries. Third, they present low measured labor productivity in goods industries because these are
more » ... nsive intermediate users, and because their intermediate TFP is relatively low. Fourth, the elasticity of aggregate GDP with respect to sector-neutral TFP is large.
doi:10.1515/bejm-2016-0223 fatcat:hijuxwhrire2fgbboxm3j2lxau